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When a LTD insurer holds back required FICA and Medicare…

Customer Question
Hello, when a LTD...

Hello, when a LTD insurer holds back required FICA and Medicare from LTD how can my employer place that on a W2 and issue me one????

Accountant's Assistant: The Accountant will know how to help. Please tell me more, so we can help you best.

It is stated above. Thanks Greg

Accountant's Assistant: Is there anything else important you think the Accountant should know?

Not at this time.

Submitted: 3 months ago.Category: Finance
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Answered in 9 minutes by:
1/8/2018
Financial Professional: Lev, Tax Preparer replied 3 months ago
Lev
Lev, Tax Preparer
Category: Finance
Satisfied Customers: 32,668
Experience: Personal Investment, Tax Preparation
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FICA taxes apply to the full amount of the disability payment for the first six calendar months after the employee has ceased performing services for the employer.

You will find explanation in the following document

https://www.irs.gov/pub/irs-wd/11-0065.pdf

Disability payments will be exempt from FICA starting in the seventh calendar month after the employee has stopped performing services for the employer.

That is between your employer and the LTD insurer who will report on W2.

In some situations - there might be two separate W2's

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Customer reply replied 3 months ago
There was 2 separate w2s. Is that correcy?
Financial Professional: Lev, Tax Preparer replied 3 months ago

Yes - that is correct.

It is very common to have separate W2 forms.

All you need to verify - if FICA are withheld from LTD payments only for the first six calendar months.

Another issue to verify - if social security taxes are not more than the limit.

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Customer reply replied 3 months ago
My employer's W-2 is $9,000 out of 38 thousand and the insurer also held back 9000 so this is approximately 47% that was held back in one year
Financial Professional: Lev, Tax Preparer replied 3 months ago

Ther are two items included into FICA

Medicare and social security taxes.

Medicare taxes are not limited - you will find that amount on W2 form box 4,

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Financial Professional: Lev, Tax Preparer replied 3 months ago

But social security taxes have a maximum - for 2017 the maximum earning subject to social security tax $127,200 * 6.2% = 7886.4 - that amount on your W2 form box 6.
So be sure the total in boxes 6 from all W2 forms is not more than this amount.

Let me know if you need any help with reporting.

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